Whether an appraisal award could be confirmed as an arbitration award considered by the Florida Court of Appeal in State Farm Florida Ins. Co. v. Gonzalez, 76 So. 3d 34 (Fla. Ct. App. 2011).
The insureds' home was damaged by a hurricane in 2005. State Farm acknowledged there was a covered loss, but an appraisal was needed because the parties disagreed on the amount of loss. In 2008, the insured's appraisal award was granted for loss in the amount of $29,763 for ordinance and law coverage and $84,090 for dwelling coverage. The appraisal award stated it was subject to the terms and conditions of the policy. State Farm paid the dwelling amount, but did not pay the ordinance and law portion because the policy required that this portion only be paid when the dwelling was actually repaired.
The insureds filed a Petition to Confirm Appraisal Award, alleging that State Farm failed to pay the ordinance and law portion and that all conditions precedent had been met. The insureds requested that the trial court confirm the appraisal award and enter a final judgment awarding them the ordinance and law amount.
The trial court granted the Petition to Confirm, but failed to articulate the reason. On appeal, State Farm contended that the trial court erred by entering the Final Judgment Pursuant to Appraisal Award.
The Court of Appeal noted that the insureds were arguing that State Farm breached the policy by not paying the ordinance and law portion of the appraisal award. Instead of filing a complaint, however, they filed the Petition to Confirm. There was no statute allowing for the filing of a Petition to Confirm an appraisal award. The trial court erroneously rejected State Farm's argument that a Petition to Confirm was not authorized and that the arbitration statutes were not applicable to appraisal awards.
Accordingly, the appellate court reversed, but remanded with instructions to allow the insureds to file a complaint alleging a viable cause of action against State Farm. The trial court was required to adjudicate State Farm's coverage defense as to the ordinance and law coverage.
